Boeing offers AI US$45 mil as compensation
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Boeing has offered an interim compensation of US$45 million in cash to Air India on account of delay in delivery of the B787 Dreamliner.The compensation is mere a 5% of the US$900 million the state-owned carrier had demanded from the Seattle-based company, Financial Express said. An airline source said Boeing has offered US$10 million in credit over and above the cash part. “The issue is between the airline and Boeing. Air India has communicated to us about the compensation Boeing has offered. Our view is that Air India should not settle for interim compensation. After three years of delay, Boeing is offering just a total of US$55 million leaving the issue for unending negotiations,” a top aviation ministry official told Financial Express.Air India had placed order to buy 27 B787 the delivery of which had to begin during the last quarter of 2008. After almost three years of delay Boeing has now said it would deliver the jet to Air India in the October-December quarter of 2011. Air India has accumulated a total loss of about INR19,000 crore as on March 2011. Its fleet acquisition worth nearly INR50,000 crore on a low equity base of INR45 crore has added to its woes and the Comptroller and Auditor General (CAG) has raised questions on its decision to buy aircraft on this scale, the paper said.”As per the contract, Air India is entitled for a compensation of $145 million and there should not be dispute on this,” aviation ministry sources said. A section of the ministry officials are of the view that Air India should cancel the order given its poor financial health.
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